Avon Products

Avon Products announced both a change of policy focus and a reduction in its dividend in June 1988. The likelihood stock price effect of the dividend reduction offset, Avon announced at the same time an unusual exchange offer under which it would be up to 25% of its common stock in exchange for an unusual preference share. The case shows the history of Avon 1979-88. Avon requires students to evaluate efforts to diversify in the early 1980s and relate this effort to c … Read more »

Avon Products announced both a change of policy focus and a reduction in its dividend in June 1988. The likelihood stock price effect of the dividend reduction offset, Avon announced at the same time an unusual exchange offer under which it would be up to 25% of its common stock in exchange for an unusual preference share. The case shows the history of Avon 1979-88. Avon requires students to evaluate efforts to diversify in the early 1980s and those of the company’s efforts relate dividend history. Also, students need to evaluate an unusual security. Suitable for freshmen or capital markets for a second year course.
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from
Jonathan Tiemann
Source: Harvard Business School
9 sides.
Release Date: 14 March 1989. Prod #: 289049-PDF-ENG
Avon Products HBR case solution